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Monday, September 9, 2013

IRDA is adequately independent to supervise insurers, says Vijayan

The Insurance Regulatory and Development Authority
(IRDA) has refuted the observation of World Bank-IMF (International Monetary
Fund) study which said that the Indian insurance regulator was not completely
independent to supervise and regulate insurance companies.

IRDA chairman, Sri T.S. Vijayan in a statement said, “IRDA would like to assert
that there is complete autonomy with regard to supervision and regulation of
insurance sector in general and insurance companies and intermediaries in
particular.”

The World Bank-IMF study report said that the insurance regulator in India is
not completely independent as a supervisory authority in view of the current
uncertainty regarding control of its funding and budget, its incomplete
oversight on the state-owned Life Insurance Corporation (LIC) of India. It said
that a maximum time frame should be specified for the regulator to respond to
various applications.

The study, further said that the insurance regulator in India is following the
‘name and shame’ practice of penalising the insurers by putting up their names
on its website as the available financial sanction powers are outdated.

According to IRDA, the concerns expressed in the study on valuation of non-life
insurer's liabilities are being addressed by strengthening the stipulations for
provisioning for incurred but not reported, and incurred but not enough
reported liabilities/claims.Source: http://www.insuringindia.com